October 18, 2006
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Is It True To Say That For Every New Promise Made, It Must Be Supported By New Consideration? Discuss
I agree to a large extent that new consideration will have to be present for every new promise made. Without new consideration, it is almost right to say that there is no new promise as the new promise cannot be based on the previous consideration which is bound only to it’s previous promise.
A consideration is the fulfillment of obligations mutually agreed between parties. Consideration need not be adequate but must be sufficient in order for it to be held binding and enforceable between parties.
Any additional promise above the first promise, for example giving a bonus to the staff to complete their job by the deadline or for asking them to do something out of their job scope would have to be supported by new consideration.
To support the above paragraph we can give reference to the Stilk V Myrick case where there were two seamen that deserted the ship. To make sure that the ship would reach it’s destination, the master of the ship promised the rest of the crew a share of the two deserters if they completed the journey. However when they arrived at the destination, the Master of the ship argued that what they are doing is that they are performing within their job scope – what they are actually being paid to do as seaman and as part of their contractual duties. Whether they get extra pay or not, they would still be bound by their duties to complete the journey. Moreover, there were only two seamen that jumped ship and it didn’t really affect the overall performance of the rest of the seamen on board, nor was there any extra risk involved in completing the journey and the ship was still deemed to be seaworthy. Therefore it was held that the crew did not provide any extra consideration for the promise and the master of the ship is not bound to give the rest of the crew the share of the two seamen’s pay.
In the other case of Hartley V Ponsonby, many of the crew jumped ship and the ship was deemed to be unseaworthy and subject to the dangers of the sea. The captain of the ship promised the remaining crew members extra pay if they would continue their journey to the designated location. The issue here is if the crew of the ship completed their journey meant that they went beyond their call of duties, thus providing extra consideration – to be bound with the new promise of being qualified to the extra pay. The court held that the captain of the ship had to give his crew additional pay as promised as the ship was unseaworthy – the crew had to accept an additional risk of the possibility of danger at sea which in this case is held to be the new consideration for the new promise offered.
In the case of Williams V Roffey Brothers, the law sees that a new promise can be binding even if there is no new consideration supporting the new promise but in this case, the following guidelines are support this case - that the promise was made willingly, made to avoid a loss or to gain profit or if the promise was made because the promissor is worried that the promisee may not be able to complete what he/she is to do on time. According to this case, if the three guidelines above are followed, there is a possibility that these guidelines can then be treated as the new consideration for the new promise.
However, the Williams V Roffey Brothers case has been criticized in UK by the re Selectmove Ltd case where the Court of Appeal did not wish to follow the application of the principles in the Williams case. The company owed the Revenue money and proposed that some arrangements be made to allow them to pay the amount owing in installments and they went on with their arrangement, thinking that the new agreement was acknowledged. However, the Revenue continued to press for full payment. It was held that, although the proposed arrangement was better for the Revenue because of the position the company’s ability to repay the amount, there was no extra consideration given by the company to the Revenue that make them legally bound to follow according to the new proposal.
Another case supporting the re Selectmove case is the Foakes V Beer case where Dr Foakes owed Mrs Beer an amount of money and both came to an agreement that Dr Foakes pay Mrs Beer in installments without any extra interest. However, after Dr Foakes completely paid off the outstanding amount, Mrs Beer sued Dr Foakes for the interest due. Mrs Beer had the Courts’ backing as she did not receive any extra consideration from Dr Foakes that made the new promise binding.
There is also a Singapore case Jagat Singh V Arthur Heng that follows the similar result of Foakes V Beer. In this case, the parties agreed to settle a debt for the lower amount. The courts held that payment of a smaller sum cannot be good consideration to overwrite a payment of a bigger sum unless this new arrangement benefits the person entitled to claim the money back. Thus, there was no new consideration and the agreement was not held binding as the lender had neither the full amount returned nor any benefits brought to him over agreeing to such arrangement. This case places further emphasis that consideration is required for the new promise to be binding.
It also seems that the Singapore cases tend to favour the Foakes V Beer, re Selectmove case and Jagat Singh case that says new consideration is needed when there is a new promise.
Personally, I would also not recommend that the law follows the William V Roffey Brothers case as, with regards that almost all cases follow the first guideline, they too, most of the time would experience a situation where the promisor would worry if they foresee that there would be an expected loss or a loss of an opportunity for profit which could be avoided if the promisee is able to complete what they are supposed to do on time. If this case is to be followed, promises that the promisor had promised in a haste to encourage the promisee to complete the task on time would in almost every case leave the promisor in a position liable to pay the promisee, no matter what the facts of the case are. Sooner or later, everybody would try to avoid entering into promises.
It may also be true that in real life, people may compromise with each other and allow the borrower to come out with alternatives but more often than not, there is a need for law to exist because the person at the less advantaged end would have problems getting back what is deserved for their effort or money put in and the law would then come handy as a guideline of what is treated as good consideration and what is treated as no consideration.
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I FINISHED! And I am so proud I did it! 1178+34 commas and 36 fullstops makes it 1248words in total, as the teacher allows it. Short of 250 but I really am drained. 3hours exam and it's not a 1question only exam plus I took a total of 5and a half hours! Including dinner and running about the house from boredom, surfing the web. Not too bad la.. Maybe 4hours in total? HAHAHA.
Ps. THIS IS MY FIRST LONG (AND ALSO LONGEST) ESSAY. =D
I mean it's an achievement for my first attempt at answering law questions without being taught the format how or what, I hope it's alright. xD
I think it's fun! I shall ask the teacher to forward questions he forward to those who strike it rich and get thedaunting wonderful task of writing a 500 word essay, of course by all means I'd try to avoid getting one. Haa.
And changing the font from Arial Narrow to Comic Sans makes a 2page long essay look 3! I rule!
Good night. <3!
-nIx- @ [[1:41 AM]]
class
hp no
Is It True To Say That For Every New Promise Made, It Must Be Supported By New Consideration? Discuss
I agree to a large extent that new consideration will have to be present for every new promise made. Without new consideration, it is almost right to say that there is no new promise as the new promise cannot be based on the previous consideration which is bound only to it’s previous promise.
A consideration is the fulfillment of obligations mutually agreed between parties. Consideration need not be adequate but must be sufficient in order for it to be held binding and enforceable between parties.
Any additional promise above the first promise, for example giving a bonus to the staff to complete their job by the deadline or for asking them to do something out of their job scope would have to be supported by new consideration.
To support the above paragraph we can give reference to the Stilk V Myrick case where there were two seamen that deserted the ship. To make sure that the ship would reach it’s destination, the master of the ship promised the rest of the crew a share of the two deserters if they completed the journey. However when they arrived at the destination, the Master of the ship argued that what they are doing is that they are performing within their job scope – what they are actually being paid to do as seaman and as part of their contractual duties. Whether they get extra pay or not, they would still be bound by their duties to complete the journey. Moreover, there were only two seamen that jumped ship and it didn’t really affect the overall performance of the rest of the seamen on board, nor was there any extra risk involved in completing the journey and the ship was still deemed to be seaworthy. Therefore it was held that the crew did not provide any extra consideration for the promise and the master of the ship is not bound to give the rest of the crew the share of the two seamen’s pay.
In the other case of Hartley V Ponsonby, many of the crew jumped ship and the ship was deemed to be unseaworthy and subject to the dangers of the sea. The captain of the ship promised the remaining crew members extra pay if they would continue their journey to the designated location. The issue here is if the crew of the ship completed their journey meant that they went beyond their call of duties, thus providing extra consideration – to be bound with the new promise of being qualified to the extra pay. The court held that the captain of the ship had to give his crew additional pay as promised as the ship was unseaworthy – the crew had to accept an additional risk of the possibility of danger at sea which in this case is held to be the new consideration for the new promise offered.
In the case of Williams V Roffey Brothers, the law sees that a new promise can be binding even if there is no new consideration supporting the new promise but in this case, the following guidelines are support this case - that the promise was made willingly, made to avoid a loss or to gain profit or if the promise was made because the promissor is worried that the promisee may not be able to complete what he/she is to do on time. According to this case, if the three guidelines above are followed, there is a possibility that these guidelines can then be treated as the new consideration for the new promise.
However, the Williams V Roffey Brothers case has been criticized in UK by the re Selectmove Ltd case where the Court of Appeal did not wish to follow the application of the principles in the Williams case. The company owed the Revenue money and proposed that some arrangements be made to allow them to pay the amount owing in installments and they went on with their arrangement, thinking that the new agreement was acknowledged. However, the Revenue continued to press for full payment. It was held that, although the proposed arrangement was better for the Revenue because of the position the company’s ability to repay the amount, there was no extra consideration given by the company to the Revenue that make them legally bound to follow according to the new proposal.
Another case supporting the re Selectmove case is the Foakes V Beer case where Dr Foakes owed Mrs Beer an amount of money and both came to an agreement that Dr Foakes pay Mrs Beer in installments without any extra interest. However, after Dr Foakes completely paid off the outstanding amount, Mrs Beer sued Dr Foakes for the interest due. Mrs Beer had the Courts’ backing as she did not receive any extra consideration from Dr Foakes that made the new promise binding.
There is also a Singapore case Jagat Singh V Arthur Heng that follows the similar result of Foakes V Beer. In this case, the parties agreed to settle a debt for the lower amount. The courts held that payment of a smaller sum cannot be good consideration to overwrite a payment of a bigger sum unless this new arrangement benefits the person entitled to claim the money back. Thus, there was no new consideration and the agreement was not held binding as the lender had neither the full amount returned nor any benefits brought to him over agreeing to such arrangement. This case places further emphasis that consideration is required for the new promise to be binding.
It also seems that the Singapore cases tend to favour the Foakes V Beer, re Selectmove case and Jagat Singh case that says new consideration is needed when there is a new promise.
Personally, I would also not recommend that the law follows the William V Roffey Brothers case as, with regards that almost all cases follow the first guideline, they too, most of the time would experience a situation where the promisor would worry if they foresee that there would be an expected loss or a loss of an opportunity for profit which could be avoided if the promisee is able to complete what they are supposed to do on time. If this case is to be followed, promises that the promisor had promised in a haste to encourage the promisee to complete the task on time would in almost every case leave the promisor in a position liable to pay the promisee, no matter what the facts of the case are. Sooner or later, everybody would try to avoid entering into promises.
It may also be true that in real life, people may compromise with each other and allow the borrower to come out with alternatives but more often than not, there is a need for law to exist because the person at the less advantaged end would have problems getting back what is deserved for their effort or money put in and the law would then come handy as a guideline of what is treated as good consideration and what is treated as no consideration.
-----
I FINISHED! And I am so proud I did it! 1178+34 commas and 36 fullstops makes it 1248words in total, as the teacher allows it. Short of 250 but I really am drained. 3hours exam and it's not a 1question only exam plus I took a total of 5and a half hours! Including dinner and running about the house from boredom, surfing the web. Not too bad la.. Maybe 4hours in total? HAHAHA.
Ps. THIS IS MY FIRST LONG (AND ALSO LONGEST) ESSAY. =D
I mean it's an achievement for my first attempt at answering law questions without being taught the format how or what, I hope it's alright. xD
I think it's fun! I shall ask the teacher to forward questions he forward to those who strike it rich and get the
And changing the font from Arial Narrow to Comic Sans makes a 2page long essay look 3! I rule!
Good night. <3!
-nIx- @ [[1:41 AM]]
